| Dear Investors,
As we begin a new decade, we examine the debate around a monetary theory that is generating much interest in this US election year. Key takeaways:
- Modern Monetary Theory says that a government that prints its own currency cannot default
- MMT argues that government spending is only problematic if it triggers inflation and politics should focus on resource availability, not projects’ costs
- MMT questions monetary policy’s focus on targeting inflation
- The theory does not offer a policy framework and does not identify when inflation threatens and hands monetary policy to politicians’ spending pledges
- MMT does offer a useful reminder that we should question the past decade’s unconventional monetary tools.
Best regards, Stéphane Monier
Chief Investment Officer, Lombard Odier Private Bank | 
